Updated x2: Confusion Whether Tesla’s Fremont Factory Can Stay Open During COVID-19 Crisis — Here’s The Story

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Update #2:

Update: Tesla’s Fremont factory in Northern California was seemingly deemed an essential business, allowing it to stay open during the wave of business closures aimed at combatting the spread of coronavirus. But then the county sheriff said it was not. Now the situation is unclear and we’re waiting on a final conclusion.

Initially, Alameda County Ray Kelly confirmed to the Los Angeles Times that Tesla’s Fremont factory had been deemed an essential business and, as such, would be allowed to continue running. Tesla CEO Elon Musk sent an email out to the team at Tesla that attempted to balance the urgency to accomplish Tesla’s mission amid the launch of the Model Y this month and the imperative to keep employees safe during the COVID-19 pandemic.

“I’d like to be super clear that if you feel the slightest bit ill or even uncomfortable, please do not feel obligated to come to work,” Musk said in the email. “I will personally be at work, but that’s just me.”

Nobody at Tesla has tested positive for COVID-19, as far as Musk knows, but the risk will only continue to climb as the coronavirus continues its inevitable march across the country. In the 6 counties comprising the Bay Area in Northern California, home to Tesla’s Fremont factory, 258 cases of COVID-19 have been reported, with 4 deaths.

Complicating matters, the local sheriff in Alameda County last night went on Twitter following the initial determination by the county and insisted Tesla’s Fremont factory was not an essential business. The position of the sheriff is based on its own interpretation of the Alameda County Health Order mandating non-essential businesses be shuttered to mitigate the spread of the novel coronavirus and the COVID-19 disease it causes.

However, the language in the order is as follows as it concerns “essential business” designation:

There’s also this claim:

Even if not deemed an “essential business,” this clause explains what “minimum basic operations” means:

The order mandates all residents to shelter in place, with a goal of minimizing person-to-person transmission of the virus. “All persons may leave their residences only for Essential Activities, Essential Governmental Functions, or to operate Essential Businesses, all as defined in Section 10.”

As with many legal writings, Section 10 of the order is written in very general terms that leave it subject to interpretation. Tesla could be considered an auto-supply, auto-repair or related facility, as noted in section 10, subsection 6. It could also be considered a business that supplies “other essential businesses with the support or supplies necessary to operate,” as detailed in section 10, subsection 15.

The ruling will likely make its way to court as Tesla attempts to strike the balance between keeping its employees safe while keeping everything humming along nicely at the Fremont factory. In our time in the factory last year, the layout of the factory was conducive to allowing for proper social distancing in just about every area we saw. Combined with additional precautions that are surely being taken to mitigate the spread of the coronavirus, it’s easy to imagine it being as safe a place to work as any during the current outbreak.

A report this morning from Bloomberg regarding the confusion starts off with this line: “Tesla Inc.’s human-resources chief told employees early Wednesday the company is awaiting ‘final word’ on the status of operations at its sole U.S. vehicle assembly plant in Fremont, California.” So, we’ll see where things land.

Approximately 10,000 people work at Tesla’s Fremont factory.

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Kyle Field

I'm a tech geek passionately in search of actionable ways to reduce the negative impact my life has on the planet, save money and reduce stress. Live intentionally, make conscious decisions, love more, act responsibly, play. The more you know, the less you need. As an activist investor, Kyle owns long term holdings in Tesla, Lightning eMotors, Arcimoto, and SolarEdge.

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